Redgreen9,

Recently there has been some discussion regarding sector rotation, that commodities have been out of favor, and that things should be turning over soon. I've been hammered here and in Emerging Markets both. We're overdue for some good things.

Marlboro,

I believe you are correct! I found this information in the Annual Information Form of 2007 (released Spring 2008). I didn't realize the investment had actually been a part of PDP; I thought it was a seperate issue. I never did research PDP so didn't know anything about how they got into the losing investment, and didn't keep track of if it were ever recompensed.

"On August 20, 2007, Petrolifera advised the Corporation and other shareholders and market participants of its exposure to short-term asset backed commercial paper ("ABCP") investments in Canada. During August 2007 these investments became due and payable and were not repaid. As at July 31, 2007, Petrolifera had approximately $37.7 million of its total cash and cash equivalents invested in notes issued by two separate trusts in the ABCP markets. Subsequently Petrolifera reclassified its ABCP investments to long term and recorded a non-cash impairment which reduced the carrying value of its ABCP investment and also resulted in lower earnings in 2007.

As the Corporation uses the equity method to account for its investment in Petrolifera, this amount was lowered by the extent of the Corporation's equity interest in the after tax impairment. There is no assurance as to the outcome of the restructuring process and the actual timing and amount ultimately recoverable from Petrolifera's investment in ABCP may differ materially from Petrolifera's estimate of such value at December 31, 2007 which would impact Petrolifera's earnings in future periods. To the extent that Petrolifera is unsuccessful in its efforts to recover its investment in full, Petrolifera may suffer a loss and the Corporation will be required to account for its proportion of such loss in accordance with its accounting policies."

Does anyone recall a few years ago, about the time of Petrolifera, what the investment was which Connacher placed some funds in and the paper turned out to be relatively worthless? I don't recall the exact situation, and wasn't able to dig anything up on it at the Connacher Web site. I believe the amount was in the neighborhood of $45M, and it was an investment in some form of Canadian Trust or something. Thank you. -bbq

I was wondering if that wouldn't happen, one of the first things that crossed my mind when I heard DG was gone.

By the way, is anyone surprised our fearless leader rejected (postponed) Keystone today? This is the excuse: "This announcement is not a judgment on the merits of the pipeline, but the arbitrary nature of a deadline that prevented the State Department from gathering the information necessary to approve the project and protect the American people," Obama said in a statement."

Has he given up running for re-election?

Hi Rebels,

What in general do you make of the current international unease to Connacher's rising share price? Iran is threatening to close the Strait of Hormuz temporarily suspending 20% of world oil transportation. An Iranian nuclear scientist was just assassinated in Tehran, with Iran sending a "rare letter to US" blaming Washington, while others suspect Israeli involvement. In the meantime, China is looking for oil supply stability via investment in Saudi Arabia. Is China just too geographically distant from Canada, Connacher just too small, or etc. to interest the Chinese?

Very dangerous situation developing at the moment. I'm considering oil prices will continue to increase due to the world market uncertainty, but what comes next? Tanking of the world economy when a coalition attacks Iran? Or further oil price escalation? We are in the middle of extraordinary historical events!

I am also a big Jurek fan! I wish I had a small portion of his ability to understand financial matters. One of Jurek's best assets is his dry humor, small comments buried here and there ... I think probably his funny remarks are lost on many readers, but his wit often leaves me with a smile. I enjoy your posts also Rebels. You and Jurek could take your show on the road. I might pony up a few dollars for a better show than Charlie Sheen. Keep the banter flowing! -bbq